Spurt in opium prices worries U.N.

Anita Joshua

With opium prices shooting up by 164 per cent in 2010 over the 2009 level owing to shortage, the United Nations Office on Drugs and Crime (UNODC) has warned of more Afghans taking to opium cultivation this year; more so with the falling prices of other licit crops. With 89 per cent of the total income from opium production going to farmers in the Taliban controlled areas of southern Afghanistan, it once again draws attention to how poppy cultivation remains a funding source for terror.

While the Afghanistan Opium Survey 2010 dwells on the strong linkage between opium production and insecurity in the southern and western parts of the war-ravaged country, the study makes no mention of an observation that was made in a September 2009 briefing to the North Atlantic Treaty Organisation by former UNODC Executive Director Antonio Maria Costa.

Reflecting on the opium situation in Afghanistan, he had warned — as per a leaked U.S. cable released by WikiLeaks — that the Taliban was withholding huge stocks of opium from the market and treating them like “savings accounts”.

This, according to him, posed a serious threat as it could fund the insurgency.

The latest UNODC report adds to the worries of the coalition forces in Afghanistan though the total area under cultivation remained at 2009 levels and production nearly halved because of a disease that affected the crop across the country.

“The market responded to the steep drop in opium production with an equally dramatic jump in the market price to more than double 2009 levels. Meanwhile, the price of wheat — one of Afghanistan's principal crop alternatives to opium — has fallen. At current pries planting opium poppies is six times more profitable than growing wheat. The high price of opium combined with a low wheat price may encourage more farmers to cultivate opium in 2011,” the report warned.

Afghanistan, according to UNODC, continues to account for about two-thirds of the global opium cultivation and 98 per cent of this is concentrated in nine provinces in the south and west of the country.

These are also the most insecure provinces with Helmand — the most dangerous place in Afghanistan — accounting for 53 per cent of all the opium that is produced in the country.

Farmers in the southern region accounted for close to 89 per cent of the total income from opium production — the highest such concentration ever encountered in Afghanistan. And, farmers in Helmand earned around $350 million, equivalent to 73 per cent of the total farm-gate value of opium in Afghanistan in 2009.